Insurers must recognise brokers as SMEs, says NIG

Insurers should stop thinking of brokers as simply a ‘distribution chain' and start treating them as highly individual businesses, NIG said at the climax of the sixth and final NIG Business Academy event for this year.

NIG finance and operations director Michael Rea said too many insurers perceived brokers as an unstructured mass rather than the hundreds of SME businesses facing their own particular problems and challenges.

Rea said: "It's clear having taken part in these events that many insurers forget that brokers are SMEs too. These are, for the most part, small businesses subject to the same risks, the same cash flow issues, the same recruitment problems as every other SME.

"As an industry, we have to stop thinking of brokers as just ‘our distribution chain' – that's an insurer-centric way of looking at the world; instead, we have to remember these are a really huge series of one-to-one partnerships. That's how I believe these relationships should operate."

Rea said that NIG had been struck by the strength of the UK's economy and the major changes currently taking place in the broking industry, including consolidation on a large scale.